The Concept
BikeArt’’s mission it to provide functional items and art made from recycled bicycle components. The art work will be made by three local artists, one of which is Steve’s wife Shoodnt. Wall clocks, picture frames and tables will be featured along with mobiles, windchimes, bookends, kitchen utensil holders and other products.
BikeArt will have its own kiosk, located in the Valley River Mall. BikeArt will have the opportunity to show its larger items thanks to its lease. This should significantly increase sales as walk through traffic in the mall is very high.
BikeArt is expected to be profitable in month nine and have profits of nearly $40,000 by year three.
Beginnings
The first month will be used to set up the kiosk and get things underway. During this month the part-time employees will be hired and trained. In the first month, sales will slow down. From the second month, sales will gradually increase due to the increased number of customers who visit the kiosk.
Total startup costs are $45,000. This will be paid for by Steve Useitagyen’s $25,000 equity investment and an additional $20,000 small-business loan.
The Company
The company will be a sole proprietorship owned and operated by Steve Useitagyen.
Steve Useitagyen has the qualifications to work in this niche. University of Portland gave him a degree in both business administration and art. Steve worked in a bicycle shop throughout college. He started as a mechanic and moved on to sales. The shop was then managed by Steve for two years.
BikeArt will use three part-time employees to man the kiosk, in addition to Steve who will take care of the hiring, payroll, and purchasing.
Market
BikeArt will target 2 market segments: bike enthusiasts and industrial artists. Eugene is home to both of these demographics. BikeArt is focusing on these two groups because they are the most likely consumers of this type of art work.
BikeArt has several competitors:
- Other shops are located in the mall.
- Art galleries
- Bicycle retailers.
BikeArt can capitalize on the unique advantage it has of being the only dealer that deals exclusively with bicycle artwork. The mall is crowded all day so it’s like having your very own shop in the middle.
Success
The company will grow slowly, establish a steady level of sales and cashflow before looking to expand. BikeArt will then look to establish additional kiosks throughout Portland, Corvallis, Salem, and Corvallis. This expansion is expected to take place after year three.
The Break-even analysis indicates that $15212 in monthly revenue would be required to reach breakeven. BikeArt’s products are priced based upon a desired net margin 12%. BikeArt’s products are locally made works of art and prices will range from $40 to $500 each.
The business is expected to reach profitability by month 9, with revenues of $147,000 and profits at $35,500 by the end year 2.
1.1 Mission
BikeArt’s mission is to offer functional items and artwork made from recycled bicycle parts. We exist to attract and maintain customers. If we follow this maxim, all else will fall into place. Our services will exceed our customers’ expectations.
1.2 Objectives
The following objectives are set for the initial three years of operation
- We want to create a kiosk that is product-based and whose primary goal it to exceed customers’ expectations.
- Every year, there is a 20% increase in product sales.
- To open a sustainable shop that sells artwork, and functional items made of recycled materials.
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